The Value of What We Own
Posted by Gail | Filed under Smart Shopper
Have you ever noticed the disparity between what people are prepared to sell something for and what other people are prepared to pay for that item. There’s a gap. Sometimes that gap is so big the thing goes unsold. Think of all the items remaining after a garage sale. Or the price a body puts on their home when they price it without the help of a (reasonable) agent. Or what they think they can get for their beat up old clunker of a car.
The gap goes beyond the fact that sellers want to get the best price while buyers want to pay the least they must. There are other factors at work that can affect your decision-making when it comes to setting the price of something you’re ready to part with for money.
The very fact that we own a something means that “that something” has value to us… value that’s greater than to the person who is only thinking about buying it. Yup, we actually develop “relationships” with our stuff. Uh boy. And those relationships make us believe that the value of our stuff is higher than it is for the person who has to lay out good money to get it.
Those relationships we form with our stuff (that camera you used to take pictures of your children, those vinyl records you listen to as you made-out in the basement) also make us focus on what we’re losing (the stuff) instead of what we’re gaining (the money). And the longer we’ve owned that stuff, the stronger the bonds. So we set the bar (price) high, because if we’re gonna part with our fabulous stuff, by golly-gosh someone’s going to have to make it worth our while.
The effort we put into our stuff also increases the value to us. So that old battered table we bought in a garage sale for a buck-ninety-two and lovingly sanded and then waxed has a lot of sweat equity in it, and we want that back in cold hard cash. This is one reason why people who reno their own homes (or act as their own general contractors) find it so hard to price their homes according to the market. “But my home is better than al the other ones on the street. Look at all the work we put into it.” Ya know what? Nobody cares how long it took you to sand that table, or how many hours you put into refinishing your floors. They’re far more likely to notice the spots where the sanding is uneven or your horrible taste in furniture.
It doesn’t matter that some jeweler appraised your grandma’s engagement ring at $2,500, if the most anyone will give you to take the ring off your hands is $250 that’s what the ring is worth. The same goes for the coin collection, the piece of art you bought with your first husband, and the beautiful antique cabinet you found in a small antique store and lovingly refinished.
If you can get someone to imagine that they already own your stuff – if you can make ‘em feel that it’s their stuff – that can work in your favour when you set the price. That’s the psychology behind all those “If you’re not happy, return it in 30 days” offers. They know you’re never going to bring it back. Having driven the car, slept on the mattress or played with the new console, the loss of returning it is too much to bear.
This is also the theory behind making your home look like Not Your Home, but like the home the buyer would like to live in. Enter all the house-stagers who put your stuff in storage and fill your house with furniture, art, flowers and the smell of baking cookies. If they can get a potential buyer to see him/herself living in the space they’re more than halfway to closing the deal.
Making you want the stuff of someone you admire is another trick of the trade. That’s why brand name stuff is perceived to be of so much more value than the run of the mill stuff you can buy at a local store. And if someone famous that you admire is wearing it, well… It isn’t really about the better quality. And it isn’t really about the fact that it exactly suits your needs. It’s the fact that you can imagine yourself as so-and-so, living even for moments in the glow of their wonderfulness.
The next time you want to sell something, find a way to link someone famous to whatever it is you’re trying to dispose of. That’s probably the only way you’ll every get what you really think it’s worth.